Correlation Between Kogeneracja and Echo Investment
Can any of the company-specific risk be diversified away by investing in both Kogeneracja and Echo Investment at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Kogeneracja and Echo Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kogeneracja SA and Echo Investment SA, you can compare the effects of market volatilities on Kogeneracja and Echo Investment and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Kogeneracja with a short position of Echo Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kogeneracja and Echo Investment.
Diversification Opportunities for Kogeneracja and Echo Investment
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kogeneracja and Echo is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Kogeneracja SA and Echo Investment SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Echo Investment SA and Kogeneracja is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Kogeneracja SA are associated (or correlated) with Echo Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Echo Investment SA has no effect on the direction of Kogeneracja i.e., Kogeneracja and Echo Investment go up and down completely randomly.
Pair Corralation between Kogeneracja and Echo Investment
Assuming the 90 days trading horizon Kogeneracja SA is expected to generate 2.15 times more return on investment than Echo Investment. However, Kogeneracja is 2.15 times more volatile than Echo Investment SA. It trades about 0.06 of its potential returns per unit of risk. Echo Investment SA is currently generating about 0.0 per unit of risk. If you would invest 5,630 in Kogeneracja SA on September 3, 2024 and sell it today you would earn a total of 350.00 from holding Kogeneracja SA or generate 6.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kogeneracja SA vs. Echo Investment SA
Performance |
| Timeline |
| Kogeneracja SA |
| Echo Investment SA |
Kogeneracja and Echo Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kogeneracja and Echo Investment
The main advantage of trading using opposite Kogeneracja and Echo Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kogeneracja position performs unexpectedly, Echo Investment can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Echo Investment will offset losses from the drop in Echo Investment's long position.| Kogeneracja vs. Banco Santander SA | Kogeneracja vs. UniCredit SpA | Kogeneracja vs. CEZ as | Kogeneracja vs. Polski Koncern Naftowy |
| Echo Investment vs. Asseco Business Solutions | Echo Investment vs. Kogeneracja SA | Echo Investment vs. Asseco South Eastern | Echo Investment vs. Movie Games SA |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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